Commentary: September 2005
Smaller Companies, Bigger Stakes
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August 1, 2005
By Tony Affuso, UGS Corp.
More and more attention is being paid to the significant benefits product lifecycle management (PLM) brings to large enterprises, but what about PLM for smaller companies? The needs to innovate, collaborate, reduce cycle times, and manage complexity—needs that PLM addresses—are common to all manufacturers, large and small.
A recent AMR Research report highlighted a common misconception that, while not all small manufacturers are the same, they cannot generally be classified as simple businesses. In fact, many struggle with the same issues as their larger counterparts, but sometimes with much higher stakes and facing more barriers along the way.
Smaller companies are, more often than ever, facing issues familiar to larger organizations. These include global sourcing as they seek to compete with suppliers around the world; product innovation and customization that must address increasingly complex customer requirements; accurate timely quotation of all available business; and program management that assures quality delivered on a timely and repeatable basis.
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In fact, addressing these issues is often considered mission-critical by smaller companies and may ultimately be tied to their very survival.
AMR goes on to say that PLM activities such as executing a design change, cost estimating, propagating BOMs to purchasing, and initiating a new product development project, among others, are all important to the success of small businesses as well as top priorities for improvement.
While these are the similarities all companies have, the differences make addressing the needs of smaller companies in some ways more challenging. In particular are consistent concerns for cost of ownership, limited resources, and an overriding feeling of “betting the business” on the systems they choose. Smaller companies might have minimal or no IT staff, limiting customization and support capability. They might be concerned with the potential 3D data explosion that can occur as they move from 2D to 3D and try to improve reuse simultaneously. Limited or no processes might hamper automation. Plus, a need to increase employee time on task could strain training resources. One misplaced step could mean irreparable damage that forces them out of business.
Fortunately PLM provides solutions that address the requirements of smaller company such as:
• A single common Windows user environment so support is easy for internal personnel and provides for easy integration of multiple applications • “Out of the box” functionality with built-in standardized solutions and processes, and limited need to customize before reaping investment advantages
• Simple interaction so users can adopt technology quickly, minimizing training and allowing even occasional users to interact with software
• Scalability with built-in data protection for application expansion into advanced uses as the company grows
• Affordability, so both the initial purchases and cost of ownership are manageable
Smaller companies need not—in fact must not—be left behind by the benefits of PLM. They can start with a PLM application that addresses their greatest area of pain and grow their capabilities incrementally as demand requires. And, by choosing PLM solutions that are open, they don’t risk losing their investment to inflexible or proprietary technology or systems that limit their pool of potential customers or suppliers.
PLM is one of the few IT solutions that can actually assist in driving top-line revenue growth, while allowing companies of all sizes to innovate, collaborate, reduce cycle times, and manage complexity. Now PLM solutions are available to address the challenges of all manufacturers—good news for smaller companies that are thinking big.
Anthony J. “Tony” Affuso is chairman, CEO and president of UGS Corp. He was president and CEO of Unigraphics Solutions Inc. and also held management positions at Xerox where he guided the automation of its design and tooling process. Affuso has a B.S. from RIT. Send your thoughts about this commentary via e-mail click here. Please reference September 2005 Commentary in your message.
